China’s homes, factories, grapple with power cuts
BEIJING – Global shoppers face possible shortages of smartphones and other goods before Christmas after power cuts to meet government energy use targets forced Chinese factories to shut down and left some households in the dark.
In the northeastern city of Liaoyang, 23 people were hospitalized with gas poisoning after ventilation in a metal casting factory was shut off following a power outage, according to state broadcaster CCTV. No deaths were reported.
A components supplier for Apple Inc.’s iphones said it suspended production at a factory west of Shanghai under orders from local authorities.
The disruption to China’s vast manufacturing industries during one of their busiest seasons reflects the ruling Communist Party’s struggle to balance economic growth with efforts to rein in pollution and emissions of climate-changing gases.
“Beijing’s unprecedented resolve in enforcing energy consumption limits could result in long-term benefits, but the short-term economic costs are substantial,” Nomura economists Ting Lu, Lisheng Wang and Jing Wang said in a report Monday.
They cut their economic growth forecast for China to 4.7% from 5.1% over a year earlier in the current quarter. They cut their outlook for annual growth to 7.7% from 8.2%.
Global financial markets already were on edge about the possible collapse of one of China’s biggest real estate developers, Evergrande Group, which is struggling to avoid a default on billions of dollars of debt.
Manufacturers are facing shortages of processor chips, disruptions in shipping and other lingering effects of the global shutdown of travel and trade to fight the coronavirus pandemic.
Residents of China’s northeast, where autumn temperatures are falling, report power cuts and have appealed on social media for the government to restore supplies.
The crunch comes as global leaders prepare to attend a U.N. environmental conference by video link on Oct. 1213 in the southwestern city of Kunming. That increases pressure on President Xi Jinping’s government to stick to emissions and energy efficiency targets.
The ruling party also is preparing for the Winter Olympics in the Chinese capital, Beijing, and the nearby city of Shijiazhuang in February, a period when it will want clear blue skies.
Scores of companies have announced power rationing could force them to delay filling orders and might hurt them financially.
Apple components supplier Eson Precision Engineering Co. Ltd. said Sunday it would halt production at its factory in Kunshan, west of Shanghai, through Thursday “in line with the local government’s power restriction policy.”
Eson said the suspension shouldn’t have a “significant impact” on operations.
Apple didn’t immediately respond to a question about the possible impact on iphone supplies.